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World Bank sanctions $300 million for building roads in Tamil Nadu

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By Newsgram Staff Writer

To improve the capacity, quality and safety of Tamil Nadu’s core road network, World Bank has approved a $300 million loan for the ‘Second Tamil Nadu Road Sector Project ‘.

To help the state fulfill its vision, Second Tamil Nadu Road Sector Project will address the accumulated investment needs by supporting upgradation of 1,175 km of the core road network.

The project will adopt a contracting arrangement to encourage economies of scale. It will also offer stronger incentives for performance, viz., Engineering Procurement Construction (EPC) contracts (430 km), Public Private Participation (PPP) concessions (145 km) and long-term Performance-Based Maintenance Contracts (PBMC, 600 km).

“While Tamil Nadu has made impressive economic progress, the state government recognizes the need for improving infrastructure, particularly road infrastructure, to make growth more inclusive.  Better roads will help improve access to markets, healthcare and education while creating new jobs and boosting agriculture,” said Onno Ruhl, World Bank Country Director for India.

“Rapid growth has also led to substantial increase in vehicle ownership. An important aspect of the project will be to strengthen road safety in order to bring down the number of fatalities and serious injuries from traffic accidents in the state,” Ruhl added.

The first project – Tamil Nadu Road Sector Project – supported upgrading (724 km) and maintaining (1,030 km) roads along with several initiatives to strengthen institutions as well as road safety. These included a road safety policy, a Road Accident Database Management System, a Road Safety Fund, and black-spot improvement.

During the project period, number of fatalities from road accidents per 10,000 registered vehicles reduced from 19 in 2003 to 11 in 2012. The percentage of roads in poor condition in the state’s core road network (CRN), comprising state highways and major district roads, reduced from about 35 per cent to 8 per cent. Also, the share of roads with less than 2-lane width in CRN decreased from 60 per cent to 38 per cent.

“The first project had a number of institutional successes but there is also an unfinished agenda. The project will support the Government of Tamil Nadu in implementing a more sustainable strategy involving innovative contracting structures with scope for greater efficiency, a gradual shift towards more optimal allocation of budgetary support towards capacity expansion and maintenance and a more coordinated approach to road safety at the state and field levels,” said Pratap Tvgssshrk, Senior Transport Specialist and World Bank’s Task Team Leader for the project.

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World Bank: Russia Banking Sector Remains at Risk Despite Recent State Costly Bailouts

"The banking sector remains afflicted with high concentration and state dominance," the World Bank said in the report

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world bank, russia banking sector
A Russian flag flies over the headquarters of the country's central bank in Moscow (file photo) RFERL

The World Bank says Russia’s banking sector is stabilizing but remains at risk despite recent state bailouts of Russian banks totaling tens of billions of dollars.

In a scheduled report dated June 10, the Washington-based lender estimated that state-owned banks now account for 62 percent of all assets at Russian banks following the closure of hundreds of lenders in recent years and the rescue of several major financial institutions.

“The banking sector remains afflicted with high concentration and state dominance,” the World Bank said in the report. The warning comes less than a week after the World Bank, the lending arm of the International Monetary Fund, cut Russia’s 2019 economic growth forecast to 1.2 percent from a previous estimate of 1.5 percent because of oil production cuts.

world bank, russia banking sector
“The banking sector remains afflicted with high concentration and state dominance,” the World Bank said in the report. Pixabay

While the bank said Russia’s macroeconomic and fiscal buffers were strong, economic growth prospects remained modest. “Downside risks to Russia’s growth outlook stem from the potential expansion of sanctions, deterioration of financial market sentiment, souring global trade environment and a dramatic drop in oil prices,” the report said.

Russia’s business climate faces stiff headwinds for many reasons, including the economic sanctions imposed by the United States, Japan, and European allies for Moscow’s 2014 seizure of Crimea, along with alleged Russian interference in U.S. elections.

ALSO READ: Russia-Backed YouTube Channels Spread Disinformation, Generates Millions of Dollars in Ad Revenue

The World Bank projected annual economic growth for the years 2020 and 2021 at 1.8 percent. “On the upside, national projects aimed at strengthening human capital and increasing productivity, if well-implemented, could positively affect Russia’s potential growth in the medium-term,” the bank said in its report.

Russia’s economy expanded 2.3 percent in 2018, aided in large part by one-off projects, buoyant energy prices, and an influx of tourists for the soccer World Cup. (RFERL)